German Industrial Slump Hits Bottom With Record Output Drop

German industrial production took a record-hit in April, before a gradual easing of lockdown restrictions set off an ever-so-slow recovery.

Output slumped 17.9% during the month that saw unprecedented closures of factories and shops, with manufacturers of investment goods particularly badly affected. Even though activity has started to pick up since then, Europe’s largest economy is still set to shrink nearly 10% in the second quarter.

The Bundesbank has offered some solace, arguing the worst of the crisis might already be past. Its latest projections are for a contraction of some 7% this year, but it also said the government’s new 130 billion-euro ($147 billion) stimulus plan to spur consumption and infrastructure spending could provide significant relief.

Some 50% of companies delayed investment projects last month, another 28% dropped them altogether, according to an Ifo survey. Factory orders collapsed in April, separate data showed Friday.

The Economy Ministry said Germany has reached the low point of the crisis. “With the step-by-step easing of protective measures and the pickup in production in the car industry, the economic recovery is now taking hold,” it said in an emailed statement.